BUSINESS MANAGEMENT - BUSINESS FORECASTING
This is the sixth of a series of newsletters published on Business Management and Management Skills. Not all topics discussed will apply to your business, but each section will be beneficial to establish company goals and objectives. By reading and studying these newsletter articles, youre taking the first step in achieving your goals.
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Business forecasting is the process of studying historical performance for the purpose of using the knowledge gained to project future business conditions so that decisions can be made today that will aid in the achievement of established goals.
Some unique individuals still manage businesses by gut feelings, which are not all that bad if youre good at it - but most of us are not. To be sure, judgment plays a roll in forecasting, but it too has changed. Perhaps the most able of forecasters combine a secret formula of math-modeling skills, tempered with portions of gut feelings, and amended by a dash of seasoned experience.
Since the social and economic worlds business operates in changes, so must the business managers view of these worlds. Many factors have combined to create an organizational climate that is faster moving, more competitive, and more complex than in the past, and promises to be more so in the future. The rapid expansion of computer usage in business has greatly increased the feasibility of forecasting by even small businesses. Computer-based forecasting models are becoming the forecasting tool of choice.
To improve your management skills, identify the major factors that negatively impact your business. The following is a list for your consideration:
Prime interest rates.
New car sales.
New home sales.
Local elementary school enrollment.
Copper futures prices.
The price of oil.
Dow Jones Industrial Average.
When youve identified these major factors that negatively impact your business, try to understand why. Then identify and study those factors that are business boosters. Once you know the factors that are external sources of influence, you can achieve the goals that you set for yourself.
As our society changes at what currently appears
to be an accelerating rate, and the need to assess the future grows, the importance of business forecasting
Mike Holts Comment: This newsletter article was extracted from Mike Holts Business Management and Management Skills Workbook. Watch for our next newsletter and, as always, we invite your comments and feedback. Send us your real-life experiences and examples. This will help us to improve our newsletters in the future. Please respond to Barbara at firstname.lastname@example.org.
Copyright © 2002 Mike Holt Enterprises,Inc.